by Kate Johns

Created on: May 23, 2008   Last Updated: June 09, 2008

Times are tough. Food prices are rising. Gas prices are out of sight. And now you've lost your main source of income. You are stressed out, and you have to find another source of income while still buying groceries and paying the bills. Just how are you going to manage your finances at this time and keep a roof over your head?

The first thing you have to do is get past the shame of losing a job. Get past the blame game and deal with it. Realize that things happen for a reason and that you can get a better job out of this situation. Apply for unemployment benefits, right away, even though the money won't come as soon as you'd like. This way you will have a reliable source of income to help pay the bills. Find out if your former employer will pay any remaining vacation pay, or days off that were accrued while gainfully employed. You might just be eligible for the benefits you worked hard for.

The next thing you need to do is figure out your current financial situation. Without getting upset, which is hard to do at this time, figure out how much money you have coming in and how much money is going out. Find out how much money you have in the bank to use to help pay bills. A good rule of thumb is to always have enough money in the bank to pay for three months of living expenses. Knowing how much money you will be dealing with, figure out your monthly bills. Basically you have to figure out the smallest amount of money you can live on for an unknown amount of time. It could be two months or six months to getting another employment situation. Married couples may be able to live on one income and unemployment benefits for a while.

Make a commitment to keeping bills at a minimum now. It's not the time to go on vacation to a sultry tropical island, even though that sounds great right now. Look at what you really don't need, and what you can live without. Get rid of those expensive premium cable packages. Buy less expensive foods at the grocery store. Stay home more often, and don't eat out at expensive restaurants. Invite people over and have them bring the goodies. Look into package deals at this time. By having the phone bill, cable TV, and the Internet all with the same service can save money.

The next big hurdle to overcome is credit card payments. Call your credit card companies and ask them to reduce the interest rates. A five percent rate reduction can save hundreds of dollars in one year. While we're on the subject of credit cards, use them sparingly. Try not to pay monthly bills with them. Unless it is an emergency, such as having to fill up the gas tank with super expensive gas, don't use that credit card. When a real emergency arises such as an appliance giving up, then it's okay to use your credit card.

If all else fails borrow money from relatives or friends, or sell something on E-Bay, to help out in the current situation. Who knows you may be starting another successful business by creating and selling a new need on E-Bay.

Transitioning from one job to another can be a difficult process. By managing your finances, you may have to do without for now. But when you get another job, life will become easier and less stressful.

Sources: Nationwide, and E How

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